Tax relief overdue and underdone

“An adjustment of tax brackets is a welcome compensation for the last seven years of bracket creep. ACT has been talking about this for years. But the adjustment is underdone,” says ACT Leader David Seymour.

“The most any taxpayer will save is $20 a week. And it’s ultimately more of a tax reset than a genuine tax cut. Bracket creep will eventually cancel out this tax relief because National refuses to permanently tie brackets to inflation.

“And the Government has bafflingly failed to adjust the top tax bracket, meaning once someone earns $70,000, they start paying 33% of every pay rise in tax.

$70,000 used to be a big salary, but now it’s not – especially if you’re paying off a student loan or mortgage.

“By failing to adjust the top bracket, the tax burden has shifted even further onto the 17% of Kiwis earning over $70,000 – who already pay 45% of all income tax.

“Meanwhile, ACT’s plan would cut tax rates for every bracket, and ensure no-one pays more than a 25% tax rate. This would help New Zealanders invest in local businesses, their families, and themselves.”
ENDS

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